Median MBA salaries jumped at the Chicago Booth School of Business in 2022, mirroring some of the school’s M7 peers.
The University of Chicago School of Business has always been considered a finance school, but that changed in 2017 when consulting became the top line of business for MBA graduates. This year, banking has made a big comeback to the Booth School of Business, hot on the heels of the board — and the starting salaries reported by the class of 2022 MBAs in the finance game have lifted all of Booth’s boats.
Booth’s latest promotion’s median total compensation increased 10.1% year-over-year – more than twice the growth rate of the previous class — to $196,600, according to the B-school jobs report. While median signing bonuses fell from $5,000 to $30,000 after a year-long rebound, median base pay rose 13% to $175,000, on par with other M7 stalwarts. Harvard Business School and overtaking regional rival M7 Northwestern Kellogg School of Management.
The bank led the fleet. The percentage of Boothies who found work in the sector soared 8 points to over 35%, with all but one sub-sector becoming a growing destination (see chart at bottom of page for details) ) – and bankers did, ahem, banking: median financial services salaries climbed to $175,000 from $160,000 last year, with private equity and investment management – together making up more than 10% of class as a whole – increasing their median base salaries by 6.7% and 13.3%, respectively. For the sector as a whole, the minimum wage increased by 22% to reach $110,000, and the maximum wage by 33% to reach $300,000; the latter figure is the highest reported by Booth for any industry in 2022.
THE COLLAPSE OF TECH – BUT NOT TECH SALARIES
However, the council remains the first sector of activity at the Booth School, although barely, with 35.5% of the 538 job seekers of the promotion against 34.1% for finance. MBB companies were the top three employers in the 2022 Boothies, with 11.3% of the class (61 graduates) going to work for McKinsey, 9.9% (53 hires) for Boston Consulting Group and 5.2% (28 hires) for Bath & Company. Median salaries for consultants matched finance at $175,000, although the consulting minimum ($71,000) and maximum ($230,000) were much lower.
“Booth’s Class of 2022 has seen a great job market and increases in compensation,” said Stephanie O’Connor, associate dean of career services at Booth School. “The increase in pay can be attributed to a change in the industry mix and, in some industries, an increase in the median base salary. Companies also tell us that Booth students are well prepared to start. Through their coursework and leadership experiences, Booth students take on functional roles that demonstrate the value of an MBA, such as investment banking, consulting, and product management.”
The most notable shift in placement is in technology, which, after many years of steadily rising, has fluctuated wildly since the pandemic began. In 2021, technology jumped over 40% to 23% of the class (see chart below), but in 2022 it fell off a cliff, dropping 35%, a full 8 percentage points, at 14.9% against 22.9%. This is the lowest proportion of a Booth class to enter the tech sector since 2014. Although Amazon was Boothies’ fourth-largest employer in 2022 with 22 hires (4% of the class), all subsectors technologies except one declined: E – commerce/internet fell from 13.5% to 9.1%, software from 6.5% to 3%, hardware from 0.7% to 0.4% and telecoms from 0.4% to nothing. Only fintech rose from 0.9% to 1.5%.
Along the same lines, Boothies heading into the startup world have been cut in half, to just 3% of the class. For comparison, HBS’s contractor share was 14% this year, compared to 12% previously, and Stanford was 18% in 2021 and 2020.
“Tech students were in high demand this year,” O’Connor notes, “and while a smaller portion of Booth graduates entered that field, median base salaries fell from $133,000 in 2021 to $146,000 in 2022.”
SHARP INCREASE IN BOOTHIES TOWARDS NEW YORK
It will come as no surprise, given the drop in tech jobs, that the percentage of Boothies who moved to the West Coast fell precipitously, to just over 20% from 26.8% last year. This includes 11.9% in the San Francisco Bay Area, 5.2% in Seattle and 2.4% in Los Angeles, all down significantly.
The recent history of Booth’s MBA spread is interesting. In 2019, the largest group of Chicago Booth MBA graduates remained in the Midwest (28.9%), with 26.1% taking jobs in Chicago. About 21.7% of the class headed to the West Coast, with 13.5% in the Bay Area, 6.1% in Seattle and 2% in LA. A nearly equal percentage (21.3%) took jobs in the Northeast, mostly in New York City, which made up 18% of the class. In 2020, in the vice of the coronavirus, even more Boothies stayed local: 32.7% in the Midwest and 29.5% in Chicago. However, West Coast numbers increased that year: 24.6% headed to the coast, including 14.5% to the Bay Area, 6.2% to Seattle and 3.7% to THE. And New York also got more Booth MBAs in 2020: 22.6% went to the Northeast, including 18.9% to the Big Apple.
Last year, as pandemic pressure on the job market eased, Midwest numbers fell to 29.6% (Chicago 27.2%); Western numbers climbed again, to 26.8% (Bay Area 14.6%); and the Northeast fell slightly to 21.8% (NYC 17.9%). So if they’ve avoided West Coast tech work, where have the Boothies mostly gone in 2022? More stayed in the Midwest (30.9%), but slightly fewer stayed in Chicago (27%). But the big increase was in the North East, where finance jobs are located, which jumped to 29.2% of the class. New York took the lion’s share: a quarter full, 25.1%.
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